A research, co-authored by three academicians, analyses the value that behavioural advertising brings to publishers.
The report titled “Online Tracking and Publishers’ Revenues: An Empirical Analysis” found that publishers only gain 4% revenue or an extra $0.00008 per targeted ad compared to non-targeted ads. However, this marginal gain also needs to be offset against compliance costs for privacy regulation borne by the publisher.
Apart from this, “wider costs” to brand reputation and user loyalty also should be considered by publishers. A majority of the value created by digital advertising sits with the duopoly with around 60% of digital advertising spend in the US concentrated between Google and Facebook.
Randall Rothenberg, CEO at IAB observed the digital supply chain to be too “complex” and “opaque”. With very little value reaching the publishers, Rothenberg emphasised the need for transparency so that publishers can benefit from the value created.
[12 minute read]